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Intel will make its own box to carry the service, which will have live TV and on demand services

Intel will launch an Internet-based TV service by the end of the year, Erik Huggers, the vice president and general manger of Intel Media, announced at AllThingsD’s Dive Into Media conference on Tuesday. Huggers’ discussion with the tech blog’s Peter Kafka and Walt Mossberg confirms a longstanding rumor, and Huggers went into some if limited detail about the service.

Intel will release its own device, which will feature live TV, on-demand and applications.

While Intel will make its service available on other devices, he insisted controlling everything part of the product is critical in this kind of venture.

“You need to control the chip, you need to control the operating system, you need to control the app layers, you need to control the sensors, et cetera,” he told the crowd in Laguna Beach. “If there were platforms out there where we could deliver exactly what we have in mind, there wouldn’t be a need to do it. But there isn’t.”

In providing live TV and apps, the Intel service would compete with both existing cable suppliers like Comcast and set-top boxes like Roku. Much of the current discussion around cable is tied to price, as the prices for channels continue to rise.

Huggers said the service would still accept bundled channels, but will distinguish itself through personalization. It will include a camera that follows the viewer, tailoring content for the viewer and providing better information for advertisers.

Creepy? A little, but you can turn it off.

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